Chondrogenesis is a process of ordered and synchronous differentiation of mesenchymal cells into chondrocytes. Endochondral ossification is a process of chondrocyte differentiation that determines skeletal growth. Our goal is to better understand the signaling and transcriptional pathways that control (i) commitment of mesenchymal cells to the chondrocyte cell lineage and (ii) the differentiation of chondrocytes during endochondral ossification. In the pursuit of this goal, we have identified a novel pathway that induces chondrogenesis and chondrocyte gene expression. In this pathway, elevation of intracellular calcium causes sequential activation of (i) calcineurin and (ii) the transcription factor, nuclear factor of activated T-cell 4 (NFAT4). NFAT4 then enters the nucleus and directly induces BMP-2 gene expression. In turn, BMP-2 acts as an autocrine/paracrine inducer of differentiation. Because calcium-dependent signaling is induced by many growth factors/hormones and basic cell biological processes, we hypothesize that calcium-dependent activation of NFATs and induction of BMP expression is a central pathway regulating chondrogenesis and chondrocyte differentiation. To test this hypothesis and further our understanding of chondrocyte differentiation we will pursue the following Specific Aims: (1) determine the effects of NFAT1, 2, and 3 on chondrogenesis and BMP expression, (2) elucidate the effect of calcineurin and NFAT4 on chondrogenesis and chondrocyte differentiation in vivo, (3) investigate the kinase control of NFATs during chondrogenesis/chondrocyte gene expression, and (4) analyze the transcriptional control of the BMP-2 gene by NFATs and cooperating regulators of transcription. These studies will utilize many reagents created during our preliminary studies and will fundamentally advance our understanding of chondrogenesis and chondrocyte differentiation. We anticipate that these studies will suggest novel ways to promote cartilage regeneration or suppress cartilage degeneration. [unreadable] [unreadable]